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When FTC designs your cancelation workflow

The Federal Trade Commission (FTC) has introduced a new rule that will directly impact how SaaS companies handle subscriptions. It's called the Click-to-Cancel rule, and it is expected to take effect in mid-2025.

The rule is part of the FTC’s broader effort to stop deceptive billing practices. It targets what the FTC calls "negative option programs," which include anything that automatically renews unless the user actively cancels.

This will affect many SaaS companies, especially those using product-led growth (PLG), free trials, and usage-based billing.

What the Rule Requires

1. Easy online cancellation
If a customer signs up online, they must be able to cancel online. The cancel flow must be just as simple and fast as the signup flow.

2. Clear and truthful disclosures
All information about pricing, billing frequency, and cancellation must be easy to find and written in plain language. No confusing fine print or hidden policies.

3. Symmetry of effort
The number of clicks or steps to cancel must be no more than the number it took to sign up. Companies cannot add friction to make cancellations harder.

4. Real consequences for violations
Noncompliance can result in civil penalties of up to $50,120 per violation per day and potentially force companies to refund customers.

Why This Matters for SaaS

SaaS companies rely heavily on recurring revenue. This rule directly impacts how customers experience subscription management.

It will be especially important for:

Companies offering free trials or self-serve plans
PLG businesses relying on easy onboarding
RevOps and legal teams managing billing policies
Anyone using a “contact us to cancel” strategy

Many B2B SaaS companies will fall under this rule, particularly those with any online checkout or signup process.

The End of Dark UX?

The FTC is sending a clear message: hiding cancel buttons, forcing people to call support, or using vague UI patterns to reduce churn will no longer be acceptable.

Some companies might try to avoid this by making their signup flows harder, just to justify a difficult cancellation process. But this approach risks harming conversion rates, increasing drop-offs, and damaging brand trust.

What to Do Now

1. Review your current flows
Walk through your signup and cancel flows. Are they truly symmetrical in effort?

2. Improve transparency
Make sure billing terms, renewal rules, and cancellation steps are clear and upfront.

3. Align your teams
Product, RevOps, and Legal should work together now rather than wait for regulatory pressure in 2025.

4. Build for trust, not resistance
Better UX builds stronger long-term relationships with customers. Making cancellation easier might reduce churn in the short term, but it increases trust and retention over time.